Toronto's new tax is a slap in the face to car owners

Bob Attrell

TADA PRESIDENT

I frequently talk to customers and fellow dealers to gauge the mood of the car-buying public.

Recently, I've sensed growing anger over the level of taxation related to driving a vehicle – particularly with the introduction of the new auto tax levied against Toronto residents who own or lease vehicles.

The new auto tax, which went into effect on Sept. 1, amounts to $60 per year for a car, and $30 a year for a motorcycle. Anyone who lives outside of Toronto is exempt.

This is a shameless and unfair tax grab aimed squarely at car owners, not drivers. It nearly doubles the annual driving fee, without adding any services or benefits to drivers whatsoever.

The Toronto Automobile Dealers Association lobbied against the tax when it was proposed last year. So did several city council members and consumer groups. But it slipped into law anyway.

Our association opposed the tax because it discriminates against car owners who live in Toronto and new-car dealerships that operate within the city. Why should Toronto drivers have to pay a tax that other Ontarians (including 905-area residents) don't? Why should Toronto dealers have to collect a tax when other Ontario dealers are exempt?

This tax was conceived by Mayor David Miller, who claimed he needed the additional revenue to balance the city's annual budget. Miller viewed car owners as an easy target, as were Toronto homeowners who got hit with an extra land transfer tax earlier this year.

I understand that Toronto has seen its federal and provincial funding slashed. I get that.

Admittedly, Miller is in a tough spot. But the solution to his fiscal dilemma shouldn't be to punish Toronto drivers and car dealers.

What do car owners get in return for this new tax? Nothing. The expected $56 million in revenue per year won't be used to expand public transit or reduce traffic congestion. Nor will it be used to build better roads or make our highways any safer.

Rather, it will be used to help offset the shortfall in Toronto's budget. Instead of finding creative ways to reduce spending and balance its books, Toronto has opted for an easy way out by burdening car owners with another unnecessary tax.

My feeling is that drivers and dealers will get numbed into acceptance – it's the Canadian way. Don't rock the boat. Don't make waves.

But when is enough, enough? Car owners are already over-taxed in Ontario. Anyone who purchases a new car is hit with a huge tax burden.

Consider:

Provincial sales tax: 8 per cent

Goods & services tax: 5 per cent

Gas guzzler tax: $75 to $7,000

Air conditioning tax: $100

Federal air tax: $100

License fee: $74 per year

New Toronto tax: $60 per year

On the purchase of a $30,000 vehicle, the average car buyer in Toronto now has to shell out a whopping $4,309 in taxes for the privilege of driving.

These taxes don't include federal and provincial gas taxes, which amount to one third of the price you pay at the pumps.

If you spend $100 per week on average on gas, or $5,200 per year, you'll end up paying another $1,716 in tax.

For the thousands of drivers affected by high taxes associated with driving a car in Ontario – especially the new auto tax – I wish I could offer you some solace.

All I can suggest is to write your political representatives at all levels of government and let your voice be heard. The more voices of protest that are registered against this greedy tax, the more likely someone will listen.

This column represents the views of

TADA. Email: president@tada.ca

or visit www.tada.ca.

Bob Attrell, president of the Toronto Automobile Dealers Association, is a new-car dealer in the GTA.

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